SB 956

Bill Subjects

Abstract

Existing law identifies various types of property of a judgment debtor that are exempt from the enforcement of a money judgment. Existing law provides that all of the exemptions that are applicable to the enforcement of a money judgment are applicable in a bankruptcy case, regardless of whether there is a money judgment against the debtor or whether a money judgment is being enforced by execution sale or any other procedure, unless the debtor elects certain alternative exemptions in lieu of all other statutory exemptions provided. Existing law provides that money held in an account owned by the judgment debtor and established pursuant to the Golden State Scholarshare Trust Act is exempt from the enforcement of a money judgment and also as an alternative exemption in a bankruptcy case, and the amount exempted is limited to contributions to the account, as specified, prior to the date of filing of the debtor's petition for bankruptcy, not to exceed the amount of the annual gift exclusion under Section 2503(b) of the Internal Revenue Code of 1986, as amended, in effect at the time of the contribution. Existing law requires the Judicial Council to adjust, every 3 years, the amounts of the exemptions applicable to exempt property based on the change in the annual California Consumer Price Index for All Urban Consumers. This bill would specify that the alternative exemption for money held in a Scholarshare account would instead be limited to an amount not to exceed the amount of the annual gift exclusion under Section 2503(b) of the Internal Revenue Code of 1986, as amended, in effect at the time of filing of the debtor's petition for bankruptcy. The bill would specify that the exemption applicable to the enforcement of a money judgment for money held in a Scholarshare account would instead be limited to contributions to the account, as specified, prior to the date of entry of a money judgment and not to exceed the amount of the annual gift exclusion under Section 2503(b) of the Internal Revenue Code of 1986, as amended, in effect at the time of entry of the money judgment. The bill would expressly specify that the amounts of these exemptions are not subject to adjustment by the Judicial Council.